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The Oil and Gas Prime Ministers of the UK

in Peak Oil by

Margaret Thatcher, one of the United Kingdom’s greatest leaders, has died. We can hear on the radio and see on TV how she is praised for her political deeds. Many consider that it was the changes in the economic system and her economic liberalism that led to the UK’s economic success in recent decades. Of course, those factors may have had a significant influence but what is not mentioned is that Margaret Thatcher took power in the UK when it was in a very favorable position – i.e. the oil companies had found oil and natural gas under the North Sea, and production was increasing. The need to import oil and gas reduced and the UK became an oil exporter. The increased gas production meant that the UK could convert away from coal for heating and so the coal mines could be shut down. Of course, there was much conflict over this, but it was evident that coal could not compete with gas. It was also good news for the environment.

Nowadays the UK is in an entirely different situation. They are forced to import oil and gas. The problem is that they no longer have a portion of their oil and gas production that can generate export income and that could pay for oil and gas imports. It is clear that the UK’s greatest days as an oil and gas producing nation are now behind it. During the era of greatest UK oil and gas production, the nation had three prime ministers, Margaret Thatcher, John Major and Tony Blair. Historians will judge how well they managed the UK’s natural wealth of oil and gas. If the light of the current economic situation in the UK one might judge that they did not do very well. The Pound Sterling is losing value, and we will see how low it can fall. Fortunately for the UK, it did not adopt the Euro as its currency because then it would be in an even more severe economic crisis. However, as it stands, the UK can devalue its currency against the Euro. We can see currently how Greece, Italy, Spain, and Portugal are unable to pay their bills for oil and gas.

It is time for the EU to study seriously the reality of its energy future.

For discussions Aleklett’s Energy Mix

Kjell Aleklett is Professor of Physics at Uppsala University in Sweden where he leads the Uppsala Global Energy Systems Group (UGES).

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